Apr 23, 2019
This post is guest-written by Nest Wealth.
For many Canadian students and families, the climbing cost of post-secondary education isn’t surprising. The fact is, university and college education is one of the biggest expenses students and families incur in their lifetime. Our research at Nest Wealth found that the average cost of tuition for a four-year undergraduate program in Canada is about $27,628, according to by Statistics Canada.
So for those interested in , there are options that can help you—like RESPs.
A Registered Education Savings Plan (RESP) is a tax-sheltered education savings account that’s meant to help parents save for their children’s post-secondary education.
You can open an RESP when your child is born and you can contribute to the RESP up to 31 years after it’s opened. If your child graduates from high school and wants to delay their post-secondary education, that’s OK too.
RESPs can be used to fund a beneficiary’s education for up to 36 years. That means if you open an RESP when your child is born, they have 36 years to use it.
Outside of making your child’s professional dreams come true (no pressure), another benefit of RESPs come from the government grants available while using this account. Here’s how that works in more detail.
The government will give you money if you use an RESP, which is a pretty great deal. Depending on the province you live in, there are a couple of government grants that could apply to you. Here are a few grants to consider:
Like any account accumulating interest, your child’s RESP will grow quicker with more contributions made to it. Plus, there’s no tax on any investment earnings as long as they stay in the RESP, meaning, more growth. Friends and family can contribute on special occasions, perhaps in place of a birthday present or even as a graduation gift.
Many Canadians consider opening their RESPs with a wealth manager to help accumulate more savings. Whether you have an RESP or are looking to open one for the first time, you can run your own numbers to see how much you can save by building a free portfolio with Nest Wealth.
Nest Wealth is Canada’s digital wealth manager that offers some of the lowest management fees in the country. With sophisticated advice starting at just $20 a month, Nest Wealth helps Canadians reach their financial potential faster and with more wealth. To learn more about Nest Wealth and your investment opportunity, visit .
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Welcome to The Ultimate Guide To Personal Finance For College And University Students, by Borrowell! In this five-part guide, you’ll learn about important personal finance concepts that will prepare you for the next few years of school and beyond.
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